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Two Nested Constant‐Elasticity‐of‐Substitution Models of Recreational Participation and Site Choice: An ‘Alternatives’ Model and an ‘Expenditures’ Model
Author(s) -
Morey Edward R.,
Breffle William S.,
Greene Pamela A.
Publication year - 2001
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1111/0002-9092.00166
Subject(s) - economics , substitution (logic) , elasticity of substitution , recreation , utility maximization , econometrics , constant elasticity of substitution , elasticity (physics) , marginal utility , constant (computer programming) , preference , microeconomics , price elasticity of demand , revealed preference , mathematical economics , computer science , production (economics) , materials science , political science , law , composite material , programming language
Two demand models of recreational participation and site choice are developed: an alternatives model and an expenditures model. Both assume maximization of utility over the year, so allow for diminishing marginal utility. They do not impose the restrictive assumption that where one goes on a trip is independent of where one plans to go on other occasions. Estimation is with a nested constant‐elasticity‐of‐substitution preference ordering: it is relatively easy to estimate because of global regularity, it allows sites to be complements, and it has the potential to be locally flexible. The application is to Atlantic salmon fishing.